Business Case

Question 1

What is the Business Case?

Answer 1

The document which sets out the main advantages and parameters of the project is called business case and is produced by either the client or the sponsor of the project who in effect becomes the owner of the document.

Question 2

What are the main functions of the Business Case?

Answer 2

Outlines the ‘why’ and ‘what’ of the project as well as making the financial case by including the investment appraisal. Provides justification for undertaking a project, in terms of evaluating the benefit, cost, and risk of alternative options and rationale for the preferred solution. Its purpose is to obtain management commitment and approval for investment in the project. The business case is owned by the sponsor.

Question 3

What are the main features of a Business Case?

Answer 3

1. Project authorisation document
2. Project viability & contribution to organisation objectives
3. The what and the why of the project
4. More opportunities than resources
5. All projects should have a business case

Question 4

Who is the owner of the Business Case and what are the functions of him?

Answer 4

Because the business case has to be prepared before the project, the owner of the BS is the sponsor. The business case is the first oficial document of the project. Therefore the perforn responsible for producing the business case usually cannot be the Project manager.

The role of the sponsor project are:

1. monitor the performance of the project manager
2. Constantly ensure the projects objectives and main criteria are met
3. ensure that the project is run effectively as well as efficiently
4. assess the need and viability of variations and agree to their implementation
5. assist in smoothing out difficulties with other stakeholders.
6. support the project by ensuring sufficient resources are available.
7. act as a business leader and top level advocate to the company board
8. ensure that the perceived benefits of the project are realized

Question 5

How will success be measured?

Answer 5

Key Performance Indicators:

1. Measurable indicators which will be used to report progress and are chosen to reflect the projects objectives and success criteria
2. Remember “what gets measured gets done”; if measures are quantitive ones then short-termism can result or quality can suffer.

Question 6

What is the Business Case Content?

Answer 6

1. Project description (the what)
2. Key deliverables
3. Situation Analysis
4. Business benefits
5. Time, cost, quality requirements
6. Performance indicators (qualitative and quantitative)
7. Key risks
8. Early exit costs
9. overview plan
10. financial appraisal
11. Other issues (project-specific)